Correlation Between Gamco Global and Mainstay Mackay
Can any of the company-specific risk be diversified away by investing in both Gamco Global and Mainstay Mackay at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Gamco Global and Mainstay Mackay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco Global Telecommunications and Mainstay Mackay New, you can compare the effects of market volatilities on Gamco Global and Mainstay Mackay and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Gamco Global with a short position of Mainstay Mackay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Global and Mainstay Mackay.
Diversification Opportunities for Gamco Global and Mainstay Mackay
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gamco and Mainstay is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Global Telecommunication and Mainstay Mackay New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Mackay New and Gamco Global is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Gamco Global Telecommunications are associated (or correlated) with Mainstay Mackay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Mackay New has no effect on the direction of Gamco Global i.e., Gamco Global and Mainstay Mackay go up and down completely randomly.
Pair Corralation between Gamco Global and Mainstay Mackay
Assuming the 90 days horizon Gamco Global Telecommunications is expected to generate 2.46 times more return on investment than Mainstay Mackay. However, Gamco Global is 2.46 times more volatile than Mainstay Mackay New. It trades about 0.32 of its potential returns per unit of risk. Mainstay Mackay New is currently generating about 0.17 per unit of risk. If you would invest 2,210 in Gamco Global Telecommunications on November 28, 2024 and sell it today you would earn a total of 95.00 from holding Gamco Global Telecommunications or generate 4.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gamco Global Telecommunication vs. Mainstay Mackay New
Performance |
| Timeline |
| Gamco Global Telecom |
| Mainstay Mackay New |
Gamco Global and Mainstay Mackay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gamco Global and Mainstay Mackay
The main advantage of trading using opposite Gamco Global and Mainstay Mackay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco Global position performs unexpectedly, Mainstay Mackay can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Mainstay Mackay will offset losses from the drop in Mainstay Mackay's long position.| Gamco Global vs. Live Oak Health | Gamco Global vs. Alphacentric Lifesci Healthcare | Gamco Global vs. Blackrock Health Sciences | Gamco Global vs. Putnam Global Health |
| Mainstay Mackay vs. Prudential Real Estate | Mainstay Mackay vs. Real Estate Ultrasector | Mainstay Mackay vs. Fidelity Real Estate | Mainstay Mackay vs. Tiaa Cref Real Estate |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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